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Government Announces ‘Unprecedented’ Measures for Small Businesses to Fight Coronavirus (COVID-19) Crisis

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Amidst deepening public health and economic crisis following global spread of Coronavirus, the government has announced economics measures ‘unprecedented in the history of the British state' to support people and businesses to navigate through ongoing hardship. Over last couple of weeks, the Chancellor, Rishi Sunak, has announced Job Retention scheme, government-backed loans worth £330 billions, £20bn of extra spending on grants and a slew of other bold initiatives to help small-businesses and individuals manage their cashflows.

Government Announces ‘unprecedented’ Measures for Small Businesses to Fight Coronavirus (COVID-19) crisis

The Chancellor has reassured that “the government would do whatever it takes” to support businesses and people through the Coronavirus emergency.

Here are important announcements from the Coivd-19 emergency package announced by the government which may be helpful for your business:

  • Statutory Sick Pay (SSP)

    • Small- and medium-sized businesses and employers can reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19 for 2 weeks per eligible employee who is off-work.
    • For eligible individuals diagnosed with COVID-19 or those who are unable to work because they are self-isolating in line with Government advice SSP will be payable from day 1 instead of day 4 for affected individuals, without any medical proof for 7 days. After the 7 days, the businesses need to decide if they need evidence.
  • Coronavirus Job Retention Scheme

    • Govt to provide part of employees’ salary for those employees that would otherwise have been laid off during this crisis.
    • HMRC will reimburse 80% of furloughed workers wage costs, up to a cap of £2,500 per month.
    • All UK businesses eligible
  • Business Rates

    • Business Rates retail discount to 100% for one year, expanded to the leisure and hospitality sectors.
    • Planned rates discount for pubs of £5,000.
    • For guidance, the businesses should contact their local authority from 20th March.
  • Grants

    • Grants of £25,000 to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value over £15,000 and below £51,000.
    • One-off grant of £10,000 to around 700,000 business currently eligible for Small Business Rate Relief (SBRR) or Rural Rate Relief, to help meet their ongoing business costs
  • Coronavirus Business Interruption Loan Scheme

    • Loan of amount up to £5 million.
    • First 12 months’ finance interest free (Government to cover interest for first 12 months).
    • Government to provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) without any charge to businesses or banks.
    • Provisions to provide further discretionary financial support to businesses.
  • VAT Deferral

    • Businesses will not need to make a VAT payment during 20 March 2020 until 30 June 2020.
    • VAT liabilities accumulated during this period can be paid until the end of the 2020 to 2021 tax year.
    • VAT refunds and reclaims to be paid by the government as normal.
    • This is an automatic offer with no applications required.
  • Income Tax

    • Income Tax (Self-Assessment) payments due on the 31 July 2020 will be deferred until the 31 January 2021.
    • This is an automatic offer with no applications required.
  • Support with Tax Affairs

    • All businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service.
    • You can call HMRC’s dedicated helpline on 0800 0159 559 for help and advice.
  • Mortgage Support

    • Mortgage lenders have agreed they will support customers that are experiencing issues with their finances as a result of Covid-19, including through payment holidays of up to 3 months.
  • Other

    • Relaxation in planning regulations to allow pubs and restaurants to start providing takeaways without a planning application.
    • Businesses are encouraged to check their terms of insurance, if they cover for both pandemics and government, as the government and insurance industry confirmed on 17 March 2020, that advice to avoid pubs, theatres etc is sufficient to make a claim.

For more details on support measures, refer here.

The Chancellor also added that UK may have to "go further and faster in the coming days" to try and prevent the spread of COVID-19.

We will keep you posted on the developments and how government is supporting businesses during these difficult and uncertain times.

To discuss your requirement and eligibility for loan and grants, the application process or any other concern, please get in touch with your account manager.

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